FMC up in the air

The fixed/mobile convergence market continues to confound. Some carriers are quietly griping that there are still not enough dual-mode Wi-Fi/mobile handsets on the market, while new technology concepts continue to stretch the definition of FMC.

While most current and near-term FMC services are based on unlicensed mobile access (UMA) technology — and many carriers see the voice call continuity (VCC) protocol within the IP multimedia subsystem standard as a longer-term support structure for FMC — femtocell architectures now offer a way for mobile carriers to extend their networks into consumer homes without relying on the availability of dual-mode handsets. The latter option isn't a network convergence strategy but more a competitive counterattack for mobile carriers.

At the Wireless 2007 trade show last month, the Wi-Fi Alliance, an FMC proponent, had several dual-mode phones on display, provided by the many handset manufacturers also at the show. The agency also touted results of a study by ABI Research that suggested U.S. wireless customers, which have barely been able to find an FMC service thus far, would have interest in switching carriers to gain access to the benefits of FMC.

Philip Solis, principal analyst for ABI Research, said in a statement announcing the research, “We expect to see a number of U.S. carriers launching convergence programs over the next twelve months.“

Frank Hanzlik, managing director of the Wi-Fi Alliance, added, “The way we look at it is there is no Wi-Fi industry anymore because these segments are joining. All of us are part of a larger broadband wireless industry.”

He said the Wi-Fi Alliance will most likely announce the certification of many FMC phones for use on standard Wi-Fi networks in the first half of this year.

However, critical observations still can be heard industrywide about device availability. “The number of phones is picking up slowly, but there aren't large volumes,” said Peter Jarich, principal analyst of wireless infrastructure for Current Analysis. “We've heard a lot of carriers say that devices [enabled with UMA technology] aren't coming quickly enough for them.”

A chicken-and-egg aspect also is clear, however, as some handset vendors say they are still waiting for large volume commitments from carriers. Still, sales forecasts for dual-mode handsets reflect the anticipation of widespread availability. ABI Research forecasted that in 2011, more than 325 million converged phones will be shipped — up from just 1.8 million last year.

The dual-mode debate is one part of the FMC picture; infrastructure is the other. The increasing array of options ultimately could handcuff carriers in the short term. UMA still reigns, but VCC lies on the horizon, and several carriers reportedly are testing both while also getting more interested in femtocells. The femtocell — a cousin of the picocell that's a lower-cost, lower-profile in-home cellular base station — was seen around the show. While questions remain as to how easily they can be deployed in large volumes, they don't need help from the handset market to succeed.

Femtocell trials will begin in Europe soon, but U.S. carriers are taking notice. “We were working with Sprint in a dual-mode [Wi-Fi/CDMA] trial, but they canned it,” said Jonathan Morgan, vice president of marketing and product management for Tatara. “They said they wanted to focus on femto. Even Cingular came by our booth and asked, ‘Do you have time to talk to us?’”

DREAMING OF FMC

25 PERCENTAGE OF U.S. CUSTOMERS SURVEYED WHO WOULD BE WILLING TO SWITCH CARRIERS FOR FMC BENEFITS

25 PERCENTAGE OF U.S. CUSTOMERS WHO WOULD SWITCH SPECIFICALLY FOR BETTER IN-HOME SIGNAL COVERAGE

24 PERCENTAGE OF U.S. CUSTOMERS WHO WOULD SWITCH FOR REDUCED IN-HOME VOICE CALLING PRICES

21 PERCENTAGE OF U.S. CUSTOMERS WHO WOULD SWITCH FOR REDUCED VOICE AND DATA PRICES FROM WI-FI HOT SPOTS

Source: ABI Research